On 23 May 2024, the European Securities and Markets Authority (ESMA) published a consultation paper setting out proposed amendments to certain technical rules concerning commodity derivatives, as mandated by the recently adopted amendments to the Markets in Financial Instruments Directive II (revised MiFID II). By way of background the revised MiFID II introduces targeted amendments to some of the provisions regarding commodity derivatives, including the extension of position management controls to trading venues which trade derivatives on emission allowances, and amendments to the scope of position reporting by excluding emission allowances and introducing a new obligation to provide two weekly position reports. Implementation of these amendments requires amendments to a number of Level 2 measures, including:

  • Commission Delegated Regulation (EU) 2022 on position management controls by trading venues (CDR 2022/1299): ESMA proposes to extend the obligation to set the accountability levels, as well as review and reporting requirements, to trading venues trading derivatives on emission allowances.
  • Commission Delegated Regulation (EU) 2017/565 on organisational requirements and operating conditions for investment firms (CDR 2017/565): ESMA includes draft technical advice to the European Commission to reflect the change of position reporting, by replacing the term ““emission allowances and derivatives thereof” with “derivatives of emission allowances”.
  • Commission Implementing Regulation (EU) 2017/1093 on format of position reports by investment firms and market operators (ITS 2017/1093): The revised MiFID II requires trading venues where options are traded to publish two weekly position reports in addition to the existing weekly report combining futures and options positions. They are also required to publish a weekly report excluding options positions. ESMA suggest that the content and format of the new weekly report (excluding options) is aligned with the content and format of the existing weekly report (futures and options combined). To this end, ESMA proposes amendments to the reporting fields. ESMA also proposes additional amendments to harmonise weekly position reports.

Stakeholders have until 23 August 2024 to submit comments to ESMA by using the response form provided.